Tuesday, June 05, 2012

The Real Problem: Not Lack of Jobs But Debt Indulgence!

David Brooks' most recent column is priceless, priceless, I say. He begins as is his wont: By stating an assertion as a fact and by shrouding it in such Republican-speech that any meaning it might have has just become impossible to spot:

Every generation has an incentive to borrow money from the future to spend on itself. But, until ours, no generation of Americans has done it to the same extent. Why?A huge reason is that earlier generations were insecure. They lived without modern medicine, without modern technology and without modern welfare states. They lived one illness, one drought and one recession away from catastrophe. They developed a moral abhorrence about things like excessive debt, which would further magnify their vulnerability.Recently, life has become better and more secure. But the aversion to debt has diminished amid the progress. Credit card companies seduced people into borrowing more. Politicians found that they could buy votes with borrowed money. People became more comfortable with red ink.Today we are living in an era of indebtedness. Over the past several years, society has oscillated ever more wildly though three debt-fueled bubbles. First, there was the dot-com bubble. Then, in 2008, the mortgage-finance bubble. Now, we are living in the fiscal bubble.

Note how actual economic and political facts are noticeable by their absence? All we are told is that people no longer fear dying in a debtor's prison and that's the reason for the dot-com and housing bubbles! A bit more suffering would do us all good! Except for the one percent, Brooks' own class.

Though given his arguments the rich should have always been borrowing far too much. After all, they didn't face that survival scarcity even in the golden olden days.

Those paragraphs make a mash out of many things. Private debt is mashed together with government spending, and the latter is equated with government debt. Debt is increasing only because too much is spent. What is completely absent in that quote are taxes: The reluctance of the rich to pay for the government expenditures. And although I'm not a historian I know that debt wasn't uncommon in the past though it was always more available for the wealthy than for the poor.

So. Brooks has explained to us that the federal deficit is the fault of our own bad habits but not the fault of our bad habits of not wanting to pay taxes. He then goes on to explain why he admires Scott Walker of Wisconsin, the governor with the worst job record of any governor last year, the governor who single-handedly is killing public unions and turning teaching into a minimum wage job.

Today voters in Wisconsin go to the polls to decide whether to recall Gov. Scott Walker. I’m not a complete fan of the way Walker went about reducing debt. In an age of tough choices, one bedrock principle should be: We’re all in this together. If you are going to cut from the opposing party’s interest groups, you should also cut from some of your own. That’s how you build trust and sustain progress, one administration to the next.Walker didn’t do that. He just sliced Democrats. But, in the real world, we don’t get to choose perfect test cases. And Walker did at least take on entrenched interest groups. He did turn a $3.6 billion deficit into a $150 million surplus, albeit with the help of a tax collection surge. He did make it possible for willing school districts to save money on health insurance so they could spend it on students.Walker’s method was obnoxious, but if he is recalled that will send a broader message, with effects far beyond Wisconsin. It will be a signal that voters are, indeed, unwilling to tolerate tough decisions to reduce debt. In Washington and in state capitals, it will confirm the view that voters don’t really care about red ink. It will remove any hope this country might have of avoiding a fiscal catastrophe.

I love the term "entrenched interest groups!" Let's apply that to the CEOs of the financial industry. Let's apply that to the Catholic Church. Let's apply that to people like David Brooks, too!

I also love "fiscal catastrophe!" Brooks never worried about that during the eight years of reckless spending by one George Walker Bush.

But this is the very best part of the column, the part where the real Brooks shines through like a pearl:

A vote to keep Walker won’t be an antiunion vote. It will be a vote against any special interest that seeks to preserve exorbitant middle-class benefits at the expense of the public good.

"Exorbitant" middle class benefits? How can they be exorbitant and still keep the receivers only in the middle class? Brooks comes across as an Uncle Scrooge here, unwilling to have teachers and fire fighters and police officers retire without having to work as greeters at the nearest Walmart.

Indeed, he comes across as one of those who'd like the country to look like a Banana Republic.

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